Mildly interesting to consider DISH separating wireless phone services away from their TV business if for no other reason than cable and satellite TV seem to be pretty much a dying industry due to streaming products. From this Cord Cutter News article, DISH has been heavily moving to diversify itself by diving into wireless phone services and 5G internet thanks to the purchase of Boost Mobile along with purchases of wireless spectrum.
It does seem that, although DISH has badly bollixed up their Republic Wireless transition, perhaps someone in the cloudy upper reaches of the company has a cunning plan afoot.
This isn’t new news. Charlie Ergen (DISH’s founder and Chairman of the Board) has been talking about the inevitability (his word) of merging DISH’s and DirecTV’s satellite businesses for some time now. Whatever DISH’s shortcomings as a company might be, Charlie (once a professional poker player in his youth) is a persistent pitch man. Bluntly, he sees a merger as a way to slow (it will not stop) the demise of satellite TV preserving as much revenue as possible for as long as possible. This makes perfect business sense. It’s what any cormpany attempting to transform itself would want to do. In that regard, RW by DISH as a “service built exclusively for DISH customers” had a certain logic to it. It’s the same logic used by the cablecos. The cablecos, however, have the advantage of offering wireline Internet as well as pay-TV, which makes using wireless as a retention strategy work much better for them than it ever could have for DISH.
On the wireless side, DISH has been acquiring (and until recently doing nothing with) spectrum for, at least, a decade. At various times, they’ve been accused by others in the wireless industry of spectrum squatting.
Whether there’s a well-disguised cunning plan involved here remains to be seen. I have great difficulty taking Boost seriously as the salvation of DISH’s wireless strategy. At best, Boost is a flanker brand akin to Cricket (AT&T) Metro (T-Mobile) and Visible (Verizon). Verizon is estimated to have 140 million subscribers, T-Mobile has 110 million and AT&T has 102 million. Boost, I believe has roughly 8 million subscribers having lost over a million from the more than 9 million Boost subscribers acquired when Boost was spun off to DISH as part of the T-Mobile/Sprint merger.
Then, maybe retail wireless isn’t part of the master plan any longer? DISH has also been talking about selling their entire retail wireless business. DISH would then focus solely on the wholesale side of building out its 5G network.
Here’s where I’ll speculate, the idea of DISH ever becoming a serious 4th national wireless player never happens. I have no doubt Charlie Ergen will continue to pitch a merger between DISH’s and DirecTV’s satellite businesses to what he hopes will be a more receptive audience among the regulators whose approvals would be needed. Further, if successful doing so, I expect DISH (and Charlie) would then be looking to cash out on their acquired wireless spectrum without necessarily completing the 5G network build out. Selling the wireless spectrum to incumbents AT&T (with whom DISH has increasingly cozy business arrangements), Verizon or a combination of the two is one option. Partnering with or selling out to a consortium of cablecos led by Comcast and Spectrum has been floated as well.
Any of the various possibilities mentioned above would need multiple regulatory approvals. The current regulatory environment is probably not favorable but remember Charlie was once a professional poker player. He knows when to hold his cards and when to fold them. He’s a good bluffer as well. As consumers, we all should want DISH to succeed as the 4th national facilities based carrier. Increased competition would be a good thing. That said, I just don’t see DISH getting there nor am I convinced there is a plan (cunning or otherwise) to do so.
But the MoffettNathanson analysts remain relatively negative on Dish’s overall business prospects.
“We would judge the likelihood that Dish is able to build a robust, sustainable, viable wireless business to be low”, they wrote in a recent note to investors. “The history of wireless startups in the US is poor and the company’s targets consumer and enterprise strike us as overly ambitious.”
@rolandh said:
The current regulatory environment is probably not favorable but remember Charlie was once a professional >poker player. He knows when to hold his cards and when to fold them. He’s a good bluffer as well.
And why did my mind hear… “you gotta know when to hold 'em, know when to fold 'em, know when to walk away, know when to run.”
Seriously, that’s very interesting. I know the government wanted a fourth major cell carrier, and it is an interesting thought that Dish may never get there (wouldn’t shock me). But I’m very sure they’re after money somewhere in all of this.
Then, the government shouldn’t have allowed the T-Mobile/Sprint merger and were, at best, naive in expecting DISH to be up to the task.
No doubt about that. And now I have to talk about the T-Mobile Center here in KC rather than the Sprint Center. The building signs are now that pinkish color rather than Sprint yellow.